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Bilibili (BILI) reports wider Q3 loss; revenues surge on strong user growth

China-based video-sharing platform Bilibili, Inc. (NASDAQ: BILI) reported a wider net loss for the third quarter of 2019, hurt by a marked increase in expenses. Meanwhile, revenues increased sharply as the company expanded its user base further.

Earnings Update by AlphaStreet

Third-quarter net loss, adjusted for one-off items, widened to RMB343 million($48 million) or RMB1.05 per share ($0.15 per share) from RMB203 million or RMB0.72 per share in the same period of last year. On an unadjusted basis, the company posted a net loss of RMB406 million ($57 million), compared to a loss of RMB246 million last year.

Cost Escalation

The bottom-line was negatively impacted by a 71% surge in operating expenses to RMB774 million (US$108 million). There was a 70% increase in the cost of revenue to RMB1.5 billion (US$211 million).

Also see: Netflix reaches a new record for subscriber growth in Q3

At RMB1.86 billion ($260 million), net revenues were up 72% from the year-ago period. Mobile games revenues moved up 25%, while revenues from live broadcasting and value-added services more than doubled. Advertising revenues surged 80%.

MAU up 38%

At the end of the quarter, the number of monthly active users was 127.9 million, which represents a 38% year-over-year increase. The number of mobile active users climbed 43% annually to 114.2 million. The number of monthly paying users, on average, rose sharply to about $8 million.

Daily active users increased 40% to 38 million, while revenue per mobile active users advanced 25% to RMB14.5.

Related: Bilibili Q3 2019 Earnings Conference Call Transcript

“Our growing library of content and efficient user growth strategy continue to pay off. We attracted considerable new traffic in the third quarter, adding 17.5 million MAUs sequentially, the highest number of net-additions in our corporate history. Our average DAUs also reached a new high of 37.6 million, increasing by 40% year-on-year in the third quarter,” said chief executive officer Rui Chen.

Outlook

For the fourth quarter, the management predicts net revenues between RMB1.93 billion and RMB1.98 billion. It expects to convert the growing traffic to paying-users in the coming months and enhance gross margin.

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